MEDTRONIC TO ACQUIRE CRYOCATH TECHNOLOGIES INC.
Montreal, Quebec, Canada - September 25,2008 - MINNEAPOLIS and MONTREAL– Sept. 25, 2008 – Medtronic, Inc. (NYSE: MDT) and
CryoCath Technologies Inc. (TSX: CYT) today announced they have entered into an
agreement whereby Medtronic, through a wholly owned subsidiary, will make a
takeover bid for all of the outstanding shares of CryoCath for $8.75 Cdn per
share in cash, representing a total equity value of approximately $400 million
Cdn ($380 million USD).
The CryoCath board of directors has unanimously recommended that CryoCath
shareholders accept the offer, and the acquisition is expected to close in the
fourth quarter of calendar 2008.
“Medtronic estimates that up to five
million patients worldwide are impacted by atrial fibrillation,” said Pat
Mackin, president of the Cardiac Rhythm Disease Management business and senior
vice president at Medtronic. “Medtronic and physicians are interested in
procedures that are safer, faster and less complex so that more patients can
benefit from treatment.”
“Medtronic’s offer reflects its endorsement of our cryoablation technology and
the role that our flagship product, Arctic Front®, will play in treating atrial
fibrillation patients around the world,” said Jan Keltjens, president and CEO of
CryoCath. “This offer delivers significant value. Joining forces with Medtronic
at this stage in our development will dramatically expand our reach and
accelerate innovation to the benefit of patients today and tomorrow.”
The offer price represents a 97 percent premium to the closing price of the
common shares of CryoCath on September 24, 2008, the last trading day prior to
the announcement of the offer and a 93 percent premium to the volume weighted
average trading price of the shares for the last 20 trading days.
The
agreement was entered into following the completion of due diligence and
negotiation during an exclusivity period and provides for, among other things, a
non-solicitation covenant on the part of CryoCath, subject to “fiduciary out,”
superior proposal and right-to-match provisions and the payment of a $13.6
million break-up fee in certain circumstances.
Medtronic’s offer to purchase is subject to the tender of at least 66 2/3
percent of CryoCath’s outstanding common shares on a fully diluted basis. The
closing of the transaction is also subject to regulatory clearance and other
customary conditions.
A take-over bid circular containing the terms of
the offer and additional information regarding the offer, as well as a
directors’ circular describing the background to the offer, will be mailed to
CryoCath shareholders in the near future. Once mailed, these documents will also
be available on the SEDAR website at www.sedar.com.
Asanté Partners is the financial advisor to the Board of Directors of CryoCath
and legal counsel to CryoCath is Davies Ward Phillips & Vineberg LLP.
Medtronic is being represented by Stikeman Elliott LLP.
About CryoCath
CryoCath - www.cryocath.com - is a medical technology
company that leads the world in cryotherapy products to treat cardiac
arrhythmias. With annual sales in excess of $40 million Cdn, its products are
routinely used in more than 500 centers around the world. The Company’s flagship
product, Arctic Front, is a minimally invasive cryo-balloon catheter designed
specifically to treat Atrial Fibrillation, an emerging $2 billion market
opportunity. Marketed in Europe and the subject of a pivotal study in the United
States, Arctic Front has been used to treat approximately 3,100
patients.
About Medtronic
Medtronic, Inc. (www.medtronic.com),
headquartered in Minneapolis, is the global leader in medical technology –
alleviating pain, restoring health, and extending life for millions of people
around the world.
Medtronic Safe-Harbor
Any forward-looking
statements are subject to risks and uncertainties. Medtronic cautions readers
that any forward-looking information is not a guarantee of future performance
and that actual results could differ materially from those contained in the
forward-looking information. Forward looking statements include, but are not
limited to, statements about the benefits of the acquisition, including future
financial and operating results, post-acquisition plans, objectives,
expectations and intentions and other statements that are not historical facts.
The following factors, among others, could cause actual results to differ from
those set forth in the forward-looking statements: the ability to obtain
regulatory approvals of the proposed acquisition, including antitrust approvals;
the failure of CryoCath shareholders to deposit a sufficient number of shares;
the risk that the businesses will not be integrated successfully; the risk that
the cost savings and any other synergies from the acquisition may not be fully
realized or may take longer to realize than expected; disruption from the
acquisition making it more difficult to maintain relationships with customers,
employees or suppliers; and competition and its effect on pricing, spending,
third-party relationships and revenues. Additional factors that may affect
future results are contained in Medtronic’s Annual Report on Form 10-K for the
year ended April 25, 2008. Actual results may differ materially from anticipated
results. Medtronic disclaims any obligation to update and revise statements
contained in this release based on new information or otherwise.
CryoCath
Safe Harbor
This press release includes "forward-looking statements" that
are subject to risks and uncertainties, including with respect to the timing of
regulatory trials and their outcome. For information identifying legislative or
regulatory, economic, climatic, currency, technological, competitive and other
important factors that could cause actual results to differ materially from
those anticipated in the forward looking statements, see CryoCath's annual
report available at www.sedar.com under the heading Risks and Uncertainties in
the Management's Discussion and Analysis section.
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